I was updating a bedroom closet at our cottage and I cut the final board a couple of inches too short. Immediately, I began to rationalize the idea that the board would work fine because no one would see it unless they were standing all the way inside the closet and it wouldn’t affect the area where the hangers and such would go.
While cutting a new board would be a slight pain, I decided to do what any wise man would do: I called my wife. I walked her through the situation and my rationale for using the short board. She thought about it for a second and said, “It’s OK. It will be fine.”
I agreed, but asked again, “Are you sure?”
She was slow to respond and I was hesitant to break the silence because we were both thinking the same thing: “Do it the right way.” So we did! We took the extra time and put in the additional effort to make it right.
This same concept is important to retirement planning, because too often people find ways to rationalize their retirement decision when everything may not be right. They may be the right age, have the right amount of money, but they can come up short in other areas.
For financial professionals, that means knowing what it takes for people to get retirement right and finish strong. In other words, we can’t send people into retirement with the idea that it will be fine or OK, only for them to see a problem once they are fully retired. We have to be ahead of the curve, and unfortunately most advisors aren’t.
I realize that’s not a very welcoming message. (“Hey! You don’t know what you need to know about retirement.”) But if someone doesn’t call you out and nudge you in a new direction, how will we get there as a profession? So I’ll be the bad guy and tell you that getting retirement right means helping people plan beyond the dollars and cents. More than 80% of what it takes to successfully retire has nothing to do with money, yet most firms focus almost 100% on the financial side of things.
What I have found is that retirees who made a good transition have found a way to accomplish six distinct things. They have:
1. Replaced their work identity;
2. Filled their time with meaningful tasks;
3. Stayed relevant and connected;
4. Kept mentally and physically active;
5. Expressed their spiritual beliefs; and
6. Felt financially secure.
The more of those things that are checked off in retirement, the greater level of satisfaction a retiree will feel. Furthermore, retirees who go into retirement with a plan or specific strategies to accomplish all six will feel satisfied much sooner. Typically when people have their money right but not the other more personal factors, they waste the first three to five years trying to figure it all out. Financial security is important. But people often find out too late that they would likely give all the money they’ve saved in exchange for the knowledge they had family, friends, good health and more time.
I know what some of you are going to say. You do talk to people about more than money and you do have very personal relationships with them. Maybe you even consider yourself holistic or comprehensive and reference retirement readiness or wellness. But let me call your bluff.
If I go to your website and LinkedIn profile, what does it say you are an expert in and interested in? Money, right? You likely don’t have a credential that says otherwise. Your blogs, guides, news feed and short videos likely don’t talk about developing a retirement plan addressing the mental, social, physical or spiritual aspects of life after work.
Remember the saying, “Show me your bank statement and I’ll show you what’s important to you”? The same holds true here: “Show me your website, and I’ll know what’s important to you.”
That leads me to another topic. Over the past couple of years, I have been coming across more and more financial professionals who want to retire themselves but don’t know how. That may sound a little counterintuitive, since most advisors consider themselves experts at helping others retire. But they are actually just experts at replacing a paycheck and retirement income, not actual retirement.
Ouch! I know that hurts to hear. But if you can figure out what it takes for your own retirement and make a successful transition, you will be a better financial advisor for others.
I noticed a trend several years ago when I was doing a presentation on making better retirement decisions at the annual FPA conference. When I was done and opened up the session for questions, all of the hands that went up were from CFP professionals asking about their own personal retirement rather than their clients’.
I guess I am saying all of this for a couple of reasons. First, I want you as a financial professional to retire right and finish strong. I realize that may be three to five years from now or 10 to 20 years away. In either case, if you’ll take the time to examine your own ideas and concepts about retirement and truly understand the psychology of it, I can assure you, you will be pleasantly surprised and have a bigger impact on people than any level of market returns you could ever provide.
There’s another thing I know from years of training, coaching and speaking to financial professionals. They all have one thing they always wanted to do but never got around to it. For some people it’s writing a book. For others it’s developing a course. But for many others it’s truly offering this more personal side to planning.
In any event, the time to get stuff right is right now. You can’t afford to wait or assume things will continue to be OK if you stay on this course. You need to be proactive and decisive.
I’ve spent this entire article beating you up, but it’s only so that now I can build you up.
I want you to write down five things it will take for you to finish strong and retire right. What five things do you need to get right for your personal retirement? Write them down. Don’t just form them mentally.
Now take the list and jot down a first step for each item. This is important, because as the world moves toward reopening this summer and fall, advisors will have a tremendous opportunity to rebrand themselves and make the discussion of wellness part of their events and client meetings. These initiatives will help them develop new business. This is your time to be innovative, ahead of the curve and establish yourself as someone who can really prove you care about more than money.
These simple steps won’t take long, but more important, they’ll position you better for working with clients considering their own retirement. While I didn’t jump into client details and the many things people may think, say or try to rationalize as they make their transition to life after work, don’t let them take the plunge until it’s all right and they can finish strong. It’s the new narrative of retirement planning, and it’s one you have to follow and model first. Don’t fall short!
Robert Laura is a best-selling author, nationally syndicated columnist, and president of Wealth & Wellness Group. He is a seasoned conference speaker, corporate trainer and pioneer in “The New Era Of Retirement,” which focuses on the non-financial aspects of life after work. He can be reached at [email protected]